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Employee Time

My son basically looks after hiring employees for us, mainly University students until high school is out then I will have three more coming on board.

We were having a conversation last evening and I don't agree with something and was wondering what you guys think.

The question or topic is:

We have to pick up a few employees and take them back home, this sometimes means an employee will have to leave a job site to drive another employee home because they have a summer class or some coach various sports.

Son thinks we should pay the employees from the time we pick them up to the time we take them back home. I was looking at these costs yesterday and it's pretty high, fuel and down time and some of our trucks are only getting 12 mpg, a lot of our work could be 45 min to an hour away from where they live.

I pay my employees between $12.00 to $20.00 an hour, last week alone the transportation costs and what I call down time costs or pay given while work is not being done is pushing $900.00m that is $3,600 a month. I also supply shirts, hats, jackets, gloves, employee is told what shade of pants to buy and where to buy them. I also supply all rain gear and three employees have company vehicles, I don't mind them stopping on the way to or from a job site with a company vehicle for personal use but vehicles are not to be used without permission for example to go out for an evening. They get a bonus from time to time, keeps moral high. I keep an eye on all this using GPS, not to watchdog the employees but I want to know where all my equipment and vehicles are.

My thought is an employee should be paid from the time they arrive at the job site until the end of the work day at a site, I would pay travel time between job sites.

So is my thinking reasonable and how to I change this without causing problems? This is an oversight on my part, I was simply doing a profitability review and picked up on this and was a bit shocked at the cost.

When I worked in the woods they gave me a company truck to use, which I thought was a great thing. They did the same things as you mentioned ( t-shirts, bonuses, etc.)
For a time we got paid from the time we got to the shop until we got back, the boss just laid it out there that this was going to stop, yeah some were upset about it but we knew if it was our business that we would've done the same thing.
After that the clock started when we got to the job site and when we left there. I did get to keep my card running as I had to go back to the shop to fill oil buckets and refuel the diesel tanks for the next day before going home. Other than that we got paid for being on site.
These days I do the same with my helper, the clock starts when we get to the first site and stops when we leave the last site.

Comment

My son basically looks after hiring employees for us, mainly University students until high school is out then I will have three more coming on board.

We were having a conversation last evening and I don't agree with something and was wondering what you guys think.

The question or topic is:

We have to pick up a few employees and take them back home, this sometimes means an employee will have to leave a job site to drive another employee home because they have a summer class or some coach various sports.

Son thinks we should pay the employees from the time we pick them up to the time we take them back home. I was looking at these costs yesterday and it's pretty high, fuel and down time and some of our trucks are only getting 12 mpg, a lot of our work could be 45 min to an hour away from where they live.

I pay my employees between $12.00 to $20.00 an hour, last week alone the transportation costs and what I call down time costs or pay given while work is not being done is pushing $900.00m that is $3,600 a month. I also supply shirts, hats, jackets, gloves, employee is told what shade of pants to buy and where to buy them. I also supply all rain gear and three employees have company vehicles, I don't mind them stopping on the way to or from a job site with a company vehicle for personal use but vehicles are not to be used without permission for example to go out for an evening. They get a bonus from time to time, keeps moral high. I keep an eye on all this using GPS, not to watchdog the employees but I want to know where all my equipment and vehicles are.

My thought is an employee should be paid from the time they arrive at the job site until the end of the work day at a site, I would pay travel time between job sites.

So is my thinking reasonable and how to I change this without causing problems? This is an oversight on my part, I was simply doing a profitability review and picked up on this and was a bit shocked at the cost.

Andy

Andy,

I think you are underestimating your costs. I donít know how it is in Canada, but here we have to match their retirement (Social Security) 7.65%, SSI (Supplemental Security Income) 3.65%, Workmanís Compensation $0.50, Disability Insurance, and Unemployment insurance.
Your employee who picks up and delivers that employee has double the time of the employee they are transporting. Furthermore, our new administration wants to require all employers to furnish health insurance for all employees. This alone could add up to another $200.00 + per employee per month.

If they worked for say ABC Vending, they would have to get to work on their own and be paid from the time they started their route until they returned from their route. There would be no down time for equipment and 2 employees, no extra fuel costs, and no need to cover the additional expense by increasing the costs to the consumer.

How do you change this policy without causing problems? I think it is a lose-lose situation. Here there is such an entitlement culture that if you do it once, they feel it is their right and your duty to continue the practice.

Honesty and a direct explanation to the "entitled" of your concerns is probably your best out.

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My thought is an employee should be paid from the time they arrive at the job site until the end of the work day at a site, I would pay travel time between job sites.

So is my thinking reasonable and how to I change this without causing problems? This is an oversight on my part, I was simply doing a profitability review and picked up on this and was a bit shocked at the cost.

I agree with your thoughts, We dont get paid any extra for having to drive to the location (most of the time) so why should they get paid that way? And as far as telling them the news, Just tell them that is why you own the Company and remind each of the benifits they do have already.
Heck! $20.00per hr.,shirts,gloves,earplugs,safty glasses,hats,truck,
I will sell out and come work for you. LOL!

Comment

We have to pick up a few employees and take them back home, this sometimes means an employee will have to leave a job site to drive another employee home because they have a summer class or some coach various sports.

Son thinks we should pay the employees from the time we pick them up to the time we take them back home. I was looking at these costs yesterday and it's pretty high, fuel and down time and some of our trucks are only getting 12 mpg, a lot of our work could be 45 min to an hour away from where they live.

I'll be very blunt here.

Your son wants to give money away... You should tell him if he wants you to pay, take the cost out of his pocket.

Transportation to and from work is a service, you should be charging them.

Comment

Your son wants to give money away... You should tell him if he wants you to pay, take the cost out of his pocket.

Transportation to and from work is a service, you should be charging them.

That thought did cross my mind, haven't said much yet but these are University friends. I Was doing a profitability analysis by employee last night, just old management nature so I wrote a small program that drew information from Simply Accounting and I noticed a big difference per hour in the guys that did mulching, compared to the guys running machinery so I did a little more investigating and discovered the guys doing mulching, yard clean ups and a few other things were being transported whereas the other guys were not so I started asking questions.

Business is business and although it may rub a few people the wrong way, things are going to change tomorrow, I will write a letter later today and email it to everyone.

Thanks for your input, I just wanted to ensure I wasn't out of line.

Andy

Andy
Halifax, Nova Scotia

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Not at all out of line, this is from a blue collar mechanic, and well I never worked anywhere where general laborers or anyone else on the totem pole got any privilege for free rides. It was either drive to work or not work. Best choice is public transportation or car pooling.

these are University friends

If they are friends of your son, your son should be doing the pick up/drop off before work.

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Not at all out of line, this is from a blue collar mechanic, and well I never worked anywhere where general laborers or anyone else on the totem pole got any privilege for free rides. It was either drive to work or not work. Best choice is public transportation or car pooling.

If they are friends of your son, your son should be doing the pick up/drop off before work.

I completely agree. And Andy, no, I think you are right on track. This is something that you need to stop doign for them. Otherwise, where will it stop??? I think everyone else has already said everything else I was thinking!!!

Good luck and Hopefully they will understand....

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I completely agree. And Andy, no, I think you are right on track. This is something that you need to stop doign for them. Otherwise, where will it stop??? I think everyone else has already said everything else I was thinking!!!

Good luck and Hopefully they will understand....

And they did, as I mentioned in another thread a few days back, we have a short and sweet staff conflab every morning, generally around 6:30 before they head out, I simply laid it out in dollars and cents. Basically offering a choice, a cut in hourly wages so that some employees could be transported or we drop paying during transport in the mornings and nights, during the day between jobs is fine. Not one person complained, they understood, we are a team and the goal is for everyone to make money, I have been setting aside a percentage of profits, On December 1st you will get a cheque, it will be based on your percentage of input to the company over the past year (hours worked), If you quit or were fired, your share is divided between those who stayed, even if they went back to school, they are still in the plan.

Here is what I mean, on December 1st there is $10,000 in the account represented by 5,000 people hours over the summer in profit set aside. Employee 1 worked a total of 300 hours this summer, he/she would get 6% of the $10,000 or $600.00 and so on, I have used this in the past at companies, employees tend to forget about it, give them a cheque at Christmas for seven or eight hundred bucks and watch them light up.

Andy

Andy
Halifax, Nova Scotia

Comment

Here is what I mean, on December 1st there is $10,000 in the account represented by 5,000 people hours over the summer in profit set aside. Employee 1 worked a total of 300 hours this summer, he/she would get 6% of the $10,000 or $600.00 and so on, I have used this in the past at companies, employees tend to forget about it, give them a cheque at Christmas for seven or eight hundred bucks and watch them light up.

That is fascinating! Do you keep them informed throughout the year how much total time they have invested and how much that comes out in $ value?

Also how do you suggest coming up with a bonus total amount? In this case being the $10,000? Should a lawn care business look to put away a certain % range of profits or pick a figure or what works best? If it is a % of profits, then the value would change through the year. Should the business owner keep the employees aware of what the updated value is?

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That is fascinating! Do you keep them informed throughout the year how much total time they have invested and how much that comes out in $ value?

Also how do you suggest coming up with a bonus total amount? In this case being the $10,000? Should a lawn care business look to put away a certain % range of profits or pick a figure or what works best? If it is a % of profits, then the value would change through the year. Should the business owner keep the employees aware of what the updated value is?

It's a tough question as many of the folks here are just starting out so things are tight, I was able to put a substantial amount of my own money in so the company didn't have to borrow as much and doesn't have the big payments so each company will be different.

Personally at the end of each month I put away 5% of new profits.

I don't tell them how much is in the account unless they ask but I tell them how much each job is worth and they all know we are doing very, very well and they are excited, they even ask if they are allowed to wear company gear when they are not working, that is very high moral and free advertising.

Andy
Halifax, Nova Scotia

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It's a tough question as many of the folks here are just starting out so things are tight, I was able to put a substantial amount of my own money in so the company didn't have to borrow as much and doesn't have the big payments so each company will be different.

Personally at the end of each month I put away 5% of new profits.

I don't tell them how much is in the account unless they ask but I tell them how much each job is worth and they all know we are doing very, very well and they are excited, they even ask if they are allowed to wear company gear when they are not working, that is very high moral and free advertising.

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I do a lot of things for employees much the same way as I did at the security company I still own part of, we had 451 employees when I took an indefinate leave in January, our turn over rate is less than one percent. I did this mainly because it cost me about $3,200 to get an employee up to speed.

I guess in this business it is different, the learning curve is a few hours compared to four weeks but I do know that if one treats their employees very well, you will have an amazing team. A happy well paid employee will show it in the quality of their work, clients will see it and the word spreads, seen this many times over the years.

Next year I may offer ownership in the company, not very hard to do and if you want to see motivated employees, I have never seen a better way to do it, pay them a dividend at the end of the year based on profits, dividends are only taxed at a fraction of what employment income is and the company pays less tax also when you go this route.

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If your sons friends had a different job in mind, I don't believe the company would be paying for their transportation.

So far, it benefits them already.

I wouldn't ask for money if I was getting a lift to & from work. That would be silly!

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Then again, if these guys have leadership qualities & do a fantastic job working for you, you still don't have to pay them for transportation, but you could maybe give a small bonus during a holiday of some sort.

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If they take a public transportation to some place very close to you then I'd pay them from pick-up time to drop off time.

Picking employees up at their house is pretty unusual and lucky for them if you're willing to do this. In that case I'd probability charge something for gas and pay them from the time they start the first job till the time they finish the last one.